factual

In Michigan, can Crave require arbitration or litigation to be conducted outside of the state?

Crave Franchise · 2025 FDD

Answer from 2025 FDD Document

ed or agreed to by a franchisee in connection with the commencement of the franchise relationship shall have the effect of (i) waiving any claims under any applicable state franchise law, including fraud in the inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.

    1. The Acknowledgment Statement included in Exhibit I of the Franchise Disclosure Document does not apply to Maryland franchisees, and Maryland franchisees should not respond or sign the acknowledgments.

CRAVE FRANCHISING, LLC PRINCIPALS:

DISCLOSURE REQUIRED BY THE STATE OF MICHIGAN

THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU:

  • (a) A prohibition on the right of a franchisee to join an association of franchises.
  • (b) A requirement that a franchisee assent to a release, assignment, novation, waiver or estoppel which deprives a franchisee of rights and protections provided in this act. This shall not preclude a franchisee, after entering into a franchise agreement, from settling all claims.
  • (c) A provision that permits a franchisor to terminate a franchise prior to the expiration of its term except for good cause. Good cause shall include the failure of the franchisee to comply with any lawful provision of the franchise agreement and to cure such failure after being given written notice thereof and a reasonable opportunity, which in no event need be more than thirty (30) days, to cure such failure.
  • (d) A provision that permits a franchisor to refuse to renew a franchise without fairly compensating the franchisee by repurchase or other means for the fair market value at the time of expiration of the franchisee's inventory, supplies, equipment, fixtures and furnishings. Personalized materials which have no value to the franchisor and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct of the franchise business are notsubject to compensation.

Source: Item 23 — RECEIPTS (FDD pages 63–253)

What This Means (2025 FDD)

According to Crave's 2025 Franchise Disclosure Document, Michigan prohibits certain unfair provisions that are sometimes included in franchise documents. If any of these provisions are present in Crave's franchise documents, they are considered void and unenforceable against the franchisee.

Among the prohibited provisions is anything that deprives a franchisee of rights and protections provided under Michigan's franchise laws, including requiring assent to a release, assignment, novation, waiver, or estoppel.

While the FDD does not explicitly state that Crave cannot require arbitration or litigation to be conducted outside of Michigan, the prohibition against depriving a franchisee of their rights under Michigan franchise law suggests that a mandatory out-of-state venue for dispute resolution could be deemed unenforceable. A prospective franchisee should consult with a legal professional to fully understand their rights under Michigan law.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.